Polkadot Faces Renewed Selling as Transaction Volume Falls
Polkadot’s native token DOT experienced a 4% decline from its 24-hour high, falling to $3.31 on July 1 as it tests critical support at $3.32. This movement mirrors a broader crypto market correction, with the CoinDesk 20 Index also down 2.4%.
Despite a bullish spike earlier in the day, DOT failed to hold gains above the $3.46 resistance level.
Ecosystem Activity Slows Sharply in 2025
One of the key drivers behind Polkadot’s weakening momentum is a significant decline in on-chain activity. The Polkadot ecosystem saw a 36.9% drop in transaction volume in Q1 2025, totaling just 137.1 million transactions. This slowdown raises concerns about network engagement and utility, especially as competitors like Ethereum and Solana maintain higher on-chain throughput.
Technical Analysis Highlights DOT’s Bearish Setup
Recent data from CoinDesk Research’s technical model reveals the following:
- Resistance was established at $3.46 during the 19:00–20:00 UTC hour on June 30 amid 1.81M volume — the session’s highest.
- Support formed at $3.32 during the 07:00 UTC hour on July 1, driven by 1.34M in volume.
- DOT attempted a brief recovery to $3.36 at 15:06 UTC, but momentum faded as institutional selling pressure returned.
- Notable volume spikes between 15:31–15:32 (267K combined) confirmed accelerated selloffs and bearish sentiment going into the U.S. trading close.
The close near $3.33 suggests sellers are firmly in control, with DOT struggling to maintain bullish structure.
Outlook: Can $3.32 Hold?
The $3.32 support level is critical. A breakdown below this threshold could open the door for further declines toward $3.20 or lower, particularly if transaction volume and user activity don’t rebound.
However, if DOT manages to hold above $3.32 and reclaim $3.36, short-term buyers may return. Market watchers should pay attention to on-chain data trends and any ecosystem updates from Polkadot’s parachain teams.
As of now, DOT’s outlook remains cautious, driven by both macro pressure and reduced fundamental activity.
Disclaimer
This content is for informational purposes only and does not constitute financial, investment, or legal advice. Cryptocurrency trading involves risk and may result in financial loss.